Japan, India sign USD 4.6b loan deal but no nuclear supply pact

Wed, 22 Oct 2008 15:12:12 GMT Japanese Prime Minister Taro Aso has agreed to a 450-billion-yen (4.6-billion-dollar) loan deal to build a major railway network in India. The agreement was signed on Wednesday during Indian Prime Minister Manmohan Singh's visit to Tokyo.
Under the agreement, Japan will provide the USD 4.6b in low-interest loans to build a freight railway between New Delhi and Mumbai. This is the largest overseas project financed by Japan.  The 1,468-kilometre (912-mile) railway between India's two largest cities will also include economic sectors around the tracks. Singh and his Japanese counterpart Taro Aso also pledged to step up military cooperation, including to help the 'war on terror' and disaster relief. Japan last year held joint naval exercises with India and the United States, despite Tokyo's post-World War II constitution which bars the country from ever using force. Aso, who came into power last month, has frequently called for expansion of ties with India to make up for Tokyo's strained relations with Beijing. However, the two leaders denied that the cooperation was aimed at countering China, where both leaders head Thursday for a summit of Asian and European leaders. JR/MMN Original Source at PressTV

The relations between India and Japan continue to flourish even though each would prefer quicker movement in areas to which it assigns high priority. New Delhi is assiduously trying to expand the network of potential suppliers to its nuclear energy programme but has been realistic enough to concede that the Japanese would be wary of getting on board. Prime Minister Manmohan Singh would not have been unduly disappointed when told during his October 22 visit to Tokyo that Ne w Delhi would need to live up to its commitments, especially with regard to testing, over a longer period before it can look to Japan for cooperation in this field. For its part, Japan would like India to be more actively involved in the security architecture of the Asia Pacific region as part of either a trilateral or quadrilateral arrangement along with the United States and Australia. The joint declaration on security cooperation signed during Dr. Singh’s visit does not specify that it was crafted with a view to dealing with “new challenges and threats.” Code phrases of this sort, which figure in the Japan-Australia document on the subject, would have left the declaration open to the interpretation that China was the target of this security tie-up. Dr. Singh very correctly went out of his way to emphasise that such cooperation would not be at the cost of any other country, least of all China.  In his address to a business forum, Prime Minister Singh also drew attention to a fundamental shift that has taken place in New Delhi’s relationships with the countries of East Asia. As he observed, even the increase in India’s bilateral trade with China last year was larger than the total trade with Japan. The implicit message was that a security arrangement providing few real benefits would not be allowed to undermine the constantly expanding economic relationship between the world’s two most populous countries. Even if unintended, Dr. Singh’s comment spotlights the fact that New Delhi is no longer as susceptible to financial pressure as it might have been in the past. That does not necessarily mean that the two countries are on an equal footing in all respects. Japan gives 30 per cent of its foreign aid to India and is, even in this period of global economic turmoil, committing more than $4 billion to the Delhi-Mumbai freight and industrial corridor. The relationship between the two countries would grow further if they can finalise the proposed Comprehensive Economic Partnership Agreement. Both New Delhi and Tokyo appear confident that they will be able to sort out the differences over agriculture, pharmaceuticals, and country-of-origin rules.